Kids And Finances

Want To Teach Your Kid About Finances? Take Them Shopping!

 

I didn’t plan for a trip with my son to Walmart to turn into a financial lesson. I’m always looking for ways to teach my son how to manage money in the real world, and this opportunity just sort of popped out of thin air.  A child’s typical view of the world is that they have needs, and it’s the job of their parents to make them appear. They don’t have a good sense for how much they cost, and how much energy financially savvy adults spend trying to make things last as long as possible in order to save money.

We stopped by Walmart to pick up a small list of items that were needed around the house. When all the items had been collected in our basket, we headed for my beloved self checkout lanes and started scanning the items.  I didn’t know my son was paying attention, until I heard him make a comment.

“Is that really how much toothbrush heads cost?"

He was referring to the $27 package of detachable heads for the electric toothbrushes that we bought the family for Christmas last year. I continued scanning, when he made another comment.

“Why are razor blades so expensive?"

He was of course referring to the $15 package of razor blades I was purchasing for his disposable razor.

He went on, “Is it because they know we have to use it every day, so they jack up the price knowing we have to buy it?"

I nodded my head, and explained that the reason for the seemingly outrageous price is something called the “captive audience phenomenon." We’ve already invested over $100 in the electric toothbrush. Unless we want to essentially waste the investment in the toothbrush, we have no choice but to buy the $27 package of brush heads to continue using the product. The same thing goes for the razor blades as well. We’ve already invested some amount (although not as much as the toothbrush) in the base razor. Unless we want to buy a different razor, or stop shaving all together, we keep buying the razors blades.

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

I scanned the rest of the items in our basket, and although he didn’t add any more comments, I could tell he was watching. Just by taking him with me on my short shopping expedition exposed him to several things that will help him once he jumps out of the nest and starts out on his own.

• Shopping Planning: I want him to see that I always head to the store with a list in hand, and once I get there I rarely stray from it.
• How Much Items Cost: My son was surprised at the cost of a couple of the items. Exposing my son to the cost of the products he uses, in combination with him just starting his first part-time job, can give him some perspective of how much he would have to work to buy them for himself.
• How Long Things Last: My son has watched me lug a huge package of toilet paper into the house. But he has no idea how long it lasts, and how often he would expect to purchase household necessities.  Talking about these things while we shop would be great conversations to have.

Our trip Walmart taught my son new information that can help him run his finances correctly once he has his own household. I think he’ll be coming with me more often.

How about you Clever Friends, do you expose your kids to the details of shopping for household necessities?

Brought to you courtesy of Brock

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